Weekly Market Recap: Yelp’s IPO, Citigroup Pushes Markets

Monday

Markets closed mixed on Wall Street today: Dow -0.01%, S&P +0.14%, Nasdaq +0.08%, Oil -1.80%, Gold -0.43%.

On the commodities front, Oil (NYSE:USO) fell to $107.79 a barrel. Precious metals were mixed, with Gold (NYSE:GLD) falling to $1,768.70 an ounce while Silver (NYSE:SLV) rose 0.20% to settle at $35.49.

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Today’s markets were mixed because:

1) Housing. More Americans signed contracts to buy homes last month as the economy added jobs at a quicker pace, home prices continued to fall, and borrowing costs remained near record lows. Pending home sales were up 2 percent in January after a 1.9 percent decrease the previous month that was smaller than originally estimated, the National Association of Realtors said today in Washington.

2) Europe. All three indexes started in the red today after global financial ministers said over the weekend that European Union leaders need to strengthen their own financial firewalls before other nations agree to back more money for the International Monetary Fund. However, stocks got a boost after the German Parliament approved the nation’s contribution to a Greece’s second 130 billion-euro bailout, as expected. Finland and the Netherlands are also expected to back the bailout this week.

3) Companies. Transocean (NYSE:RIG) booked a $6.1 billion loss, though mostly on one-time charges, including a $1 billion estimated loss on the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, but shares were up today because the company reported an 11 percent jump in revenue during the last quarter, beating expectations. Motorola Solutions (NYSE:MSI) shares were also up after it said it bought back $1.2 billion in stock from activist investor Carl Icahn and affiliates.

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Tuesday

Markets closed up on Wall Street today: Dow +0.18%, S&P +0.34%, Nasdaq +0.69%, Oil -1.75%, Gold +0.66%.

On the commodities front, Oil (NYSE:USO) fell to $106.66 a barrel. Precious metals were up, with Gold (NYSE:GLD) climbing to $1,766.60 an ounce while Silver (NYSE:SLV) rose 3.81% to settle at $36.96.

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Today’s markets were up because:

1) Oil. Investors have been keeping a close eye on Iran, as the nuclear conflict pushed crude futures up nearly 9 percent in seven days to a 9-month high of above $109 a barrel on Friday. Unsurprisingly, the rise in oil prices has translated into higher gas prices at the pump, with the national average rising for 21 days straight. So consumers most certainly took notice when crude futures eased Tuesday for the second consecutive day, lessening concern that higher gas prices could cause the economic recovery to stall.

2) Sentiment. Consumer confidence rose to its highest in a year this month, according to a Conference Board gauge, as employment prospects improved and stock markets continued to stage a rally that has seen them recover pre-Recession levels. If that consumer confidence in turn spurs spending, which accounts for roughly 70 percent of the U.S. economy, then Americans will really have something to be happy about.

3) Goods. Durable goods orders plunged 4 percent in January to a 3-year low, according to a Commerce Department reported today, dampening some of the positive sentiment that led markets in an early rally. The decline in orders for everything from household appliances to aircraft would seem to indicate that the economic recovery may not be so robust as recent job figures have led people to believe.

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Wednesday

Markets closed down on Wall Street today: Dow -0.41%, S&P -0.47%, Nasdaq -0.67%, Oil +0.33%, Gold -5.25%.

On the commodities front, Oil (NYSE:USO) rose to $106.90 a barrel. Precious metals were down, with Gold (NYSE:GLD) falling to $1,694.50 an ounce while Silver (NYSE:SLV) declined 7.10% to settle at $34.57.

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Today’s markets were down because:

1) Treasuries. Shortly after Federal Reserve Chairman Ben Bernanke began testifying before Congress this morning, yields on 10-year Treasuries rose above 2 percent from 1.94 percent within minutes. Moments later, gold prices dropped more than 4 percent, and the euro suddenly fell from $1.3460 to $1.3400. But it would be unfair to blame it all on Bernanke — traders speculate that it may have been the result of a large Treasury trade gone awry, which could have caused computer trading models to then make large interrelated trades in currencies and commodities. Chance incident or not, gold and silver futures remain down hours after the conclusion of Bernanke’s testimony, and the euro continues to fall.

2) Bernanke. While the Fed chairman might not be responsible for the drop in commodity prices, he didn’t help matters with his gloomy outlook. Bernanke warned Congress today that unless growth accelerated, the unemployment rate would not keep dropping in the months ahead. And yet he didn’t offer the slightest bit of hope the central bank might undergo a third round of quantitative easing, a controversial albeit seemingly effective measure that in the past has helped stimulate growth.

3) Apple. The Nasdaq crossed the 3,000 mark this morning for the first time since December 2000, thanks in large part to Apple (NASDAQ:AAPL), which jumped to nearly $547 a share in the first few minutes of trading after closing around $535 a share on Tuesday. Apple recently overtook ExxonMobil (NYSE:XOM) to become the largest publicly traded company in the world by market capitalization, and has seen its share price grow roughly 70 percent since founder and former CEO Steve Jobs died on October 5. However, despite Apple’s help, the Nasdaq quickly turned south to finish the day in the red.

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Thursday

Markets closed up on Wall Street today: Dow +0.22%, S&P +0.62%, Nasdaq +0.74%, Oil +1.76%, Gold +0.33%.

On the commodities front, Oil (NYSE:USO) rose to $108.95 a barrel. Precious metals were down, with Gold (NYSE:GLD) climbing to $1,716.90 an ounce while Silver (NYSE:SLV) rose 2.53% to settle at $35.52.

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Today’s markets were up because:

1) Jobs. New claims for unemployment benefits continued to decline last week, holding close to four-year lows, according to a Labor Department report on Thursday. The jobless data, paired with upbeat reports on personal income and spending, led to an early morning rally.

2) Manufacturing. Markets dipped after an index of U.S. manufacturing activity came in weaker than expected. U.S. manufacturing has been one of the few bright spots in the global economy, but growth cooled in February. However, stocks ultimately pared losses, as the report still signaled expansion in the sector, and the day’s other economic indicators were consistent with better economic growth.

3) Financials. The financial sector led today’s advance, with JPMorgan (NYSE:JPM) and Citigroup (NYSE:C) climbing more than 2 percent, while Goldman Sachs (NYSE:GS) closed the day up 5 percent.

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Friday

Markets closed down on Wall Street today: Dow -0.02%, S&P -0.42%, Nasdaq -0.43%, Oil -1.97%, Gold -0.52%.

On the commodities front, Oil (NYSE:USO) fell to $106.70 a barrel. Precious metals were also down, with Gold (NYSE:GLD) falling to $1,713.30 an ounce while Silver (NYSE:SLV) fell 2.36% to settle at $34.82.

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Today’s markets were down because:

1) EU. At the end of a two-day meeting in Brussels, leaders of 25 of the European Union’s 27 member states signed on to a so-called fiscal compact designed to prevent against future debt crises by forcing countries on the euro to adhere to stricter budget guidelines and keep deficits low. But Spanish Prime Minister Mariano Rajoy quickly cast a pall upon the otherwise happy conclusion to many months of debate about how best to preserve the single-currency union when he announced that Spain would no longer aim to reduce its deficit to 4.4 percent of gross domestic product, instead aiming for 5.8 percent of GDP this year after the deficit exceeded targets last year and amid predictions that the economy will shrink in 2012.

2) Oil. With little major economic news outside of Europe, investors continued to keep a close watch on the global oil market and rising gas prices. Gas prices climbed for the 24th straight day on Friday, hovering around $3.74 a gallon. Until the standoff over Iran’s nuclear program comes to an end, oil prices will likely remain high, well above $100 a barrel, though WTI crude declined some today.

3) Yelp. The big news today was Yelp’s (NYSE:YELP) initial public offering, which saw shares spike nearly 64 percent, closing at $24.58 after starting day with an initial pricing of $15 a share. But the business reviews site wasn’t the only company making headlines, as Shutterfly (NASDAQ:SFLY) shares surged after the company announced that it would buy Eastman Kodak’s online photo services business for $23.8 million.

To contact the reporter on this story: Emily Knapp at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com